Hello all, I have 115K in a post office pension that has sat going up zero for over ten years. I have exactly the same pot as I did when I left. I’m 51 and under new rules want to take it out and am happy to tie it into someone like Hargreaves Landsdown for 14 years as I’m only 51 at the moment. With a return of 7% a year this would give me a decent pension at 65. I have already taken out £13K which I’d built up in my pension as AVCs and put it into a SIPP.
Royal Mail are saying I can’t take it out yet what they are doing is freezing my pension payout but using my money to invest for others.
Does anybody know how I can force my own pension out ?
Thanks for any advice. I was in a pension called POPs and put in as much as I could over 20 years. It seems a bit much them using my pension yet not increasing it year on year !
If you were in POPs, that suggest you was a member of a final salary scheme then? So what is the benefit due to you when you reach the NRA? Twenty years service should results in a very tidy annual pension! Looking at the numbers and assuming your salary was £18,200 which is average for a postman in 2008 back then, 20/60 would be £6,066 per year, and assuming it was CPI linked since then, it would be worth £7,694 per year? Assuming it is 2% CPI for next 14 years, it would be worth £10,152 per year in 14 years time or £7,694 per year in today's term.
Always worth asking them for a benefit statement maybe? As Brynsam highlighted below, you really need to supply more information.
Brynsam Posts: 3,643 Forumite
More info needed please. Why precisely are Royal Mail saying you can't transfer out the rest of your pension? What sort of pension is it (if you aren't sure, could you give the full name as printed on any correspondence/booklets you have)? Why do you think it hasn't gone up at all in the last 10 years? When did you leave?
xylophone Posts: 45,030 Forumite
Hello all, I have 115K in a post office pension that has sat going up zero for over ten years. I have exactly the same pot as I did when I left.
You left before 2008? You have a have a deferred Defined Benefit pension with RMSPS?
For more details about the pension increases,
visit the website and go toLeaving the Plan
Deferred benefits.
Every year we'll send you a current value statement,
showing you how much your deferred benefits
are worth (including any increases we've added).
If you wish to transfer out of a DB Scheme and the value of your benefits is greater than £30,000 then you will be required to take the advice of a Pension Transfer Specialist.
DairyQueen Posts: 1,834 Forumite
Hello all, I have 115K in a post office pension that has sat going up zero for over ten years. I have exactly the same pot as I did when I left. I’m 51 and under new rules want to take it out and am happy to tie it into someone like Hargreaves Landsdown for 14 years as I’m only 51 at the moment. With a return of 7% a year this would give me a decent pension at 65. I have already taken out £13K which I’d built up in my pension as AVCs and put it into a SIPP.
Royal Mail are saying I can’t take it out yet what they are doing is freezing my pension payout but using my money to invest for others.
Does anybody know how I can force my own pension out ?
Thanks for any advice. I was in a pension called POPs and put in as much as I could over 20 years. It seems a bit much them using my pension yet not increasing it year on year !
My brother has worked for Royal Mail for many years and I've looked at some of the pension benefits (changed over the years) on his behalf recently. I'm hoping someone intimately acquainted with the complexity will be along shortly.
In the meantime.
This will be a Defined Benefit Scheme and, if you left in 2008, those benefits will be protected and valuable. I don't think you understand the benefits. They aren't 'frozen', they are deferred after you leave service and are revalued over time.
You need to understand the scheme before you make any decisions. As xylophone mentioned you will not be able to transfer-out of a DB scheme without taking advice from an Independent Financial Advisor who is qualified as a Pension Technical Specialist. That advice will cost in the region of ballpark £1000-2000+ (if you can find an IFA that will take the case). There is also no guarantee that the advice will be positive, and many platforms will not accept transfers from DB schemes even if the advice is positive.
This forum is full of threads that explain the reasons for this.
I very much doubt that, once you understand the benefits, you will wish to transfer.
First step. research the scheme and the benefits. Call the administrators for clarification if necessary.
dasherman Posts: 228 Forumite
If you were in POPS(now renamed section C) you will have joined the pension scheme sometime between 1st April 1987 and 31st March 2008.
When the company was privatised, the government took on the pension liabilities up to 31st March 2012 and that part of the scheme was renamed the Royal Mail Statutory Pension Scheme(RMSPS). The Royal Mail are responsible for liabilities built up from that date onwards via the Royal Mail Pension Plan(RMPP).
By the rough dates you give, it sounds as if all your benefits are with the RMSPS. This is the governments’ responsibility – it is now effectively a public sector scheme! And they have said that transfers out of the RMSPS and into DC schemes are currently not possible.
That fact is covered in the link Xylophone provided and is also covered on the main Royal Mail pensions website where it clearly says:
Your pension has different parts, including:
• The RMSPS benefits you built up before 1 April 2012 and the RMPP benefits you built up after this date.
• Age60 benefits, which are usually paid when you reach 60, and Age65 benefits, which are usually paid when you reach 65.
• Additional Voluntary Contributions (AVCs), if you choose to pay them.
You can transfer different parts separately. However, under Government rules you can’t transfer your RMSPS benefits to a Defined Contribution arrangement (that includes the Royal Mail Defined Contribution Plan). Contact the Pensions Service Centre for more information. Remember: you should always get financial advice to ensure you make the choice that’s right for you.
Your deferred Royal Mail pension has been increasing with CPI inflation since you left the company!
